JEEVAN Arogya is the first defined health insurance product to be introduced by India's largest life insurance company, LIC of India. It will pay the customer a fixed daily cash amount as well as cover specific surgeries.
The product is a Hospital Cash Benefit Plan (HCB) that offers daily hospital cash benefit for a fixed number of days that one is hospitalised. Besides that, it will cover 140 surgeries with the maximum amount one can avail for surgeries being 100 times the daily limit.
The product also offers a lump sum amount that is twice the daily cash limit per hospitalisation day, even for surgeries not listed. This feature is similar to the HCB plan offered by Aegon Religare Life Insurance. Life insurer Tata AIG's Wellsurance Family Classic offers a standard daily cash plan without any surgery benefits.
Jeevan Arogya has a number of features that should take care of rising health care costs.
For instance, it increases the limits on the initial daily benefits every year. So, one's daily cash limits will rise to a maximum of five per cent or up to 1.5 times of the initial amount each year. This would be in addition to the five per cent added to one's daily cash limit as part of one's cumulative or no-claim bonus. Together, this could lead to a 10 per cent rise in one's daily cash benefit.
No doubt, even other health insurers (both life and general) offer a nearly five per cent rise in the sum assured as part of one's cumulative bonus. However, Jeevan Arogya customers are assured of getting a five per cent rise, even if they are not eligible for no-claim benefits.
Besides, since all other benefits are linked to the person's daily limits, a rise in the daily limit translates into higher day care and major surgery benefits.
Another feature allows automatic waiver of the subsequent year's annual premium for customers who make a claim for major surgical benefits.
However, Jeevan Arogya is a complicated product with both yearly and lifetime limits on how many times a claim can be made. So, one is allowed only three day care claims and only one major surgery claim in a year.
In terms of costs, it is much cheaper than the Aegon Religare product. If you opt for a daily cash limit of `2,000, you would be paying an annual premium of `4,000 for Jeevan Arogya. For the same limit, Aegon Religare's premium would be `13,800.
However, health products from life insurers are more restrictive in nature. While HCBs pay a lump sum, the hospital cash offered by general insurers covers the actual expenses falling within the amount sum insured.
Also, HCBs only cover illnesses mentioned in their policy document. They also permanently exclude pre-existing ailments. In comparison, four years of continuous cover with a general insurer will get you a cover for a pre-existing disease. Except hospitalisation due to accidents, life insurers' policies usually have longer cooling periods of 90 days from the effective date of the policy.
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